UK unemployment rises to 2.52 million

Nicholas Palmer, ONS: 'The period of falling unemployment appears to have come to an end'

UK unemployment has risen to 2.52 million, the Office for National Statistics (ONS) has said.

ONS figures showed 15,000 more people were unemployed in the three months to the end of March, with the unemployment rate now at 7.8%.

Jobseeker's Allowance claimants fell by 7,300 last month to 1.52 million.

But despite this an ONS spokesman told the BBC the figures suggested the recent period of falling unemployment "seems to have come to an end".

The total number of people in employment fell by 43,000 to 29.7 million, although the number of vacancies was at its highest level since 2008.

'Reality check'

The figures also reveal the degree of the slowdown in pay growth.

Average earnings increased by 0.4% in the year to March, compared with a rate of 0.8% in the year to February.

That is the lowest rate of growth since 2009, and means wages are continuing to fall in real terms, with inflation still well above the target rate of 2%.

When bonuses are stripped out, the picture appears even worse. Earnings grew by 0.8% over the year - the lowest rate of increase since the ONS began reporting the figure in its current format 12 years ago.

Analysis

The ONS has confirmed what was becoming clear in the jobs market figures last month - that the lengthy period of falling unemployment has come to an end.

The jobless total is up and the employment level down over the three months to March. But that does not mean unemployment is set to continue rising.

It is possible the labour market is moving from a healthy stage to one which is flatter. The fact that the narrower claimant count (those on Jobseekers' Allowance) fell again, suggests a mixed picture for employment.

The latest weaker headline figures could reflect lack of growth at the end of last year and the pick up in economic activity in the first quarter of 2013 could point to a brighter picture on jobs later in the year.

Employment Minister Mark Hoban described the figures as "disappointing".

But he said the falls in claimant numbers and in youth unemployment, along with an increase in vacancies, were reasons for optimism.

Employment minister Mark Hoban: "There are some positive signs but we cannot be complacent."

The unemployment total for young people aged between 16 and 24 is now at 958,000 - a rate of 20.7% - down 17,000 in the quarter.

But Labour's shadow work and pensions secretary, Liam Byrne, said "the figures speak for themselves".

"A lot of the jobs being created are temporary jobs, self employed or part time," he told the BBC. "There is insecurity in the jobs market right now, that is coming home to roost."

Analysts said the figures were in contrast to recent encouraging data suggesting a slow recovery in the UK economy.

"Following recent positive news on the economy, today's UK labour market data provides something of a reality check," said Martin Beck, economist at Capital Economics.

He said the fall in claimant numbers was one piece of positive news, but said that trend could be temporary.

"With further significant public sector job losses in the pipeline and firms likely to seek to restore productivity by shedding workers, it may not be long before even this narrower measure of unemployment starts to rise too."

The British Chambers of Commerce (BCC) said the UK had a "relatively robust" labour market, and unemployment rates compared favourably with the eurozone.

But David Kern, the BCC's chief economist, said rising unemployment underlined the need for the government to "develop a stronger growth strategy".

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